The Penny Drops On Why People Used Third Party Exchanges

The whole idea of a holiday is to relax and recharge your batteries. Unfortunately this often isn’t the case and I’ve returned from a fortnight in Majorca and find myself pretty much cream crackered. However it’s a holiday weekend so by my return to work on Tuesday I should be relaxed and have my batteries recharged… alternatively I may just be cream crackered.

Whilst I have been away I notice that Linden Lab seem to have realised that people used third party exchanges for reasons other than just the sheer hell of it and in a blog post they talk of people buying Linden Dollars in different currencies and a new pilot scheme whereby authorised third party sites will be able to sell Linden Dollars, in a variety of currencies if they so wish. This deals with some of the concerns of residents because those third party sites offer more payment options than the LindeX does.

Paypal does not work for everyone, in some countries you can’t withdraw from Paypal to a local bank account, that’s one of the reasons why everyone doesn’t use Paypal and whereas these changes do not deal with cashing out to local currencies, they do deal with purchasing Linden Dollars, progress of a sort there.

The blog post does state:

We know that users are also concerned about the length of the LindeX’s cashout process and the limited choice of currencies when selling L$. We’re currently investigating ways to improve that experience for users while still providing superior fraud protections, and hope to hasten the cashout process and offer new currency options in the future.

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The LindeX Should Not Be So Uncompetitive

In all the fallout of the Third Party Exchange issue, the LindeX has came under the spotlight and is found to be extremely short of providing the service users crave. There’s no doubt now that Linden Lab are disallowing the use of third party exchanges, Virwox have updated their page to state:

Linden Lab has recently changed their Terms of Service. Under the new rules, we will no longer be able to offer our service to Second Life residents. Linden Lab insists that our in-world terminals (ATMs) have to be removed.

This means that we can currently not accept Linden Dollars from Second Life or pay Linden Dollars to Second Life. Other virtual currencies are not affected.

This should really put an end to questions about the blog post contradicting the terms of service, the blog post was correct, use of third party exchanges is not allowed and actions are exemplifying this. However why are people miffed about the end of third party exchanges? The reason is simple, third party exchanges offered a more efficient service with a wider range of payment options. The question therefore is why can Linden Lab not compete?

I’ll give a personal example, this TOS change has left me in a rather large pickle because a transfer to Paypal I was planning via VirWox now can’t take place. Why does this leave me in a pickle? Well that’s my own fault, I wanted to transfer funds before this weekend and was waiting for as much to transfer as possible, by using VirWox I would have been able to do this. However now that I have to use the LindeX, my plans have all gone tits up.

However this isn’t Linden Lab’s fault, it’s my fault because I should know by now that Linden Lab are quite happy to make announcements with no forethought, no warning, no consideration and no respect and as I have long known this, I should make all plans related to Second Life with that in mind, so it’s my fault for forgetting how Linden Lab operate. However the question remains, why on earth do Linden Lab take so long to transfer funds?

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Third Party Exchanges Fallout In Progress

The fallout from yesterday’s terms of service change blog post is now in full swing. The outlook for third party exchanges looks bleak from the posts I’ve seen, but confusion still reigns due to the discrepancy between the blog post, which explicitly stated trading on thier party exchanges is not allowed and the actual new terms of service, which make no such reference. This issue is not just in the area of third party exchanges either, third party viewer developers have also been sent a message relating to the Buy L$ feature in their viewers.

The problems started rather quickly, Maria Korolov over at Hypergrid business reported that First Meta Exchange had announced :

We are really sad to announce that we will not be doing any linden exchanges from now onwards. Due to the recent changes in SecondLife’s Terms of Service we must SUSPEND ALL LINDEN TRADING IMMEDIATELY. We will be updating you via email with more information soon.

Meanwhile other exchanges have ceased trading whilst seekig clarification on what the terms of service changes mean, ELDEXchange announced:

you might have seen the changes of ToS regarding exchanges other than the Lindex. We try to get more information about the consequences. Meanwhile we cant accept new sell orders. We will inform you as soon as we have more information.

VIRWOX, arguably the largest third party exchange announced:

We have asked Linden Lab for clarification. Until we know what this all means, we have disabled deposits of Linden Dollars (the terminals will send them back), disabled the “Currency Shop” for Linden Dollar purchases, and disabled the withdrawal of Linden Dollars to Second Life. Other virtual currencies are not affected.

Moneyslex announced:

Linden Lab has recently changed their Terms of Service.Trading L$ as Third Party exchange Linden Lab interprets as “unauthorized” as “not permitted”.This would mean that we can at the moment not offer our service to Second Life residents.

However as the confusion reigns, some third part exchanges are still operating.

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TOS Change As Clear As Mud

There’s much angst around regarding Linden Lab’s updated terms of service and part of that angst has been caused by Linden Lab not being clear about what they claim to be being clear about. The blog post, seems straight forward enough:

When you log in to the Second Life Viewer today, you’ll be asked to accept an updated Terms of Service. As with any legal document, it’s important to read in its entirety before accepting, but we wanted to highlight one of the changes we’ve made in this update: to better protect Second Life users against fraud, the updated Terms of Service make it clear that trading of Linden dollars (L$) on exchanges other than the LindeX, Second Life’s official L$ exchange, is not authorized or allowed.

 As the official exchange owned and operated by Linden Lab, the LindeX is the best place to buy and sell L$ for use in Second Life. It consistently offers the best rates for both buyers and sellers, and by limiting L$ trading to the exchange we operate, we are better able to protect users against fraudulent activity.

That to me sounds like Linden Lab are limiting trading of Linden Dollars to the Lindex, that the likes of Virwox are not allowed and that if I do trade on Virwox, I’m doing something that is not allowed and in breach of the terms of service. However the relevant section of the new Terms Of Service makes no reference whatsoever to trading on third party exchanges being forbidden:

5.3 There are other exchanges that are operated by third parties on which Linden dollars are exchanged.

Third party exchanges are not authorized by Linden Lab and Buying or Selling Linden dollars on third party exchanges are not authorized transactions. Third party exchanges are wholly distinct from both the LindeX exchange and Linden Lab and they have no affiliation with Linden Lab. We do not endorse or otherwise guarantee the legitimacy of the Linden dollar transfers offered on them, and we are not liable for purchases of such Linden dollars. Buying or Selling Linden dollars anywhere other than the LindeX is done so solely at your own risk. If you Buy Linden dollars that are traced to unauthorized credit card activity or other fraudulent activity, we will recoup these Linden dollars from your Account. The only authorized exchange is the LindeX.

This suggests that if I purchase Linden Dollars on a third party exchange, I do so at my own risk, which I always thought was the case anyway, but nowhere does it say it’s not allowed and that is rather an important discrepancy which Linden Lab should be looking to clear up because I don’t want to trade on a third party exchange at my own risk and then find my account is in jeopardy because Linden Lab consider it a breach of the Terms Of Service.

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The Dick Van Dyke No Show – Part 2

There’s a great episode of Family guy called PTV, basically Peter sets up his own television station after the FCC censor all sorts of things after someone has a wardrobe malfunction at the Emmy awards, Peter is aghast at the censorship, which includes Dick Van Dyke having Dick and Dyke blanked out. So where Family Guy treads, it seems Linden Lab follow.

The above may sound familiar to older readers, it’s from this post of mine from March 2011. Eventually the issue was fixed, however it’s back, well partially back, if you type Dick Van Dyke on the Second Life forums, you now get Dick Van **bleep**. Now you might feel that only having part of Dick Van Dyke shows there’s a small chink in armour of the Second Life forum word filter, alas a small chink in the armour would actually be a small **bleep** in the armour, as Perrie Juran discovered when he typed the following:

Going back to Andrew’s explanation, what it amounts to was that there was a tiny chink in the Viewer that has now opened up into a big gaping hole. The Server is doing it’s job correctly, the Viewer is asleep at the wheel.

An innocuous looking statement discussing the issue of prims not appearing in the viewer. However what now appears on the forum is:

Going back to Andrew’s explanation, what it amounts to was that there was a tiny **bleep** (eta: I don’t believe that c.h.i.n.k. got bleeped!) in the Viewer that has now opened up into a big gaping hole. The Server is doing it’s job correctly, the Viewer is asleep at the wheel.

We’re back knee deep in the silliness of word filters and the silliness exemplified in the Family Guy episode. The worst thing about word filters like this is that they highlight the negative context some words can be used in, whereas if they left them alone, nobody would bat an eyelid.

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